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Reports | Thursday October 5, 2023

AI and Human Rights in Healthcare

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The Healthcare sector is increasingly using AI, from health or clinical care, research and drug development, public health surveillance and monitoring, to health systems management. This report identifies human rights issues associated with the growing importance of AI technologies and provides recommendations to companies on addressing these impacts.

Blog | Wednesday October 4, 2023

Nine Ways to Mitigate Risk of Child Labor Across the Supply Chain

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Child labor is on the rise across the world, with increasing incidence in wealthier nations, challenging the common assumption that it is primarily an emerging economy concern. Workforce shortages, migration patterns (including the increasing presence of undocumented workers and their children) conflict, and weakening regulations around child labor—particularly in the US—are all contributing to the rising exploitation of underage workers in high-income countries. This is especially true for industries that rely on low-skilled and flexible labor, including manufacturing, agriculture, and automotives, among others.

In the US, the Department of Labor (US DOL) reported that child labor violations have increased by 70% since 2018. Instances of child labor violations have been uncovered both in the supply chains of agriculture and meat processing facilities in the US, as well as in front-of-house positions within fast food restaurants. Meanwhile, at least 10 states have passed laws to weaken child labor standards in the last two years—including extending working hours and eliminating work permits for teenagers. Migrant and undocumented children are among the most vulnerable: the U.S recently opened investigations into Tyson Foods and Perdue Farms for child labor violations alleging that contractors working for the companies hired migrant children. 

Children are increasingly used to fill labor gaps, with migrant and undocumented children particularly vulnerable to exploitation. Outside the US, Australian food companies are also facing allegations of breaking child labor laws, while a café reportedly hired 11-year-old children to address labor shortages. In Russia, there are movements to ease child labor laws and regulations to help the country fill workforce gaps left by the war with Ukraine, which has also exacerbated risks. 

Adverse Impacts of Child Labor

Child labor refers to work that is dangerous, excessive, or harmful to children, including mental and physical well-being. According to UNICEF, many child laborers are subjected to long working hours, hazardous working environments, physical injuries, and mental, emotional and developmental health impacts making even them more vulnerable to trafficking and abuse.

In addition to jeopardizing children’s health, safety and development, child labor can have long-term impacts on families and communities. According to the ILO, more than 25% of children aged 5 to 11 and over 33% of children aged 12 to 14 who are in child labor do not go to school. By disrupting or ending schooling, child labor limits future work and economic opportunities, increasing income inequality over generations.

Implications for Business 

Child labor is a violation of international human rights and labor rights laws and standards. Businesses that employ children or have child labor in their supply chains—including those in high-income countries—face reputational damage, compliance and legal risks. According to the US Labor Department, there has been an 87% increase in fines on employers in recent months, and companies across the country have been hit with $6.6 million in penalties for child labor violations. 

Companies must navigate a complex regulatory landscape, with differing approaches to regulations across regions—and within countries – as well as increased scrutiny to counter weakened protections. In the US, companies may be caught between conflicting State and Federal laws. Amidst weakening regulations at the State level, the US federal government has taken steps to intensify labor investigations. The USDA has responded by increasing efforts to combat child labor in the meatpacking industry, while the Fair Labor Standards Act (FLSA) plays a crucial role in regulating and protecting workers' rights in these circumstances. Similarly, in Australia, the federal government has engaged in a new pledge to ‘stamp it out’ with similar calls in New Zealand.

While there are movements within some countries to reduce protection for children in the workforce, other countries and regions are taking a strong stance against child labor and requiring companies to eliminate the practice from their operations and supply chains.

In the United Kingdom, there have been calls from the All-Party Parliamentary Group on Street Children in June 2023 to outlaw child labor entirely. In Canada, the House of Commons has passed a bill aimed at tackling forced and child labor; however, critics argue that corporations still find ways to evade meaningful accountability. At the regional level, the EU has adopted a zero-tolerance policy on child labor in its new trade agreements and has implemented an EU Strategy on the Rights of the Child to further protect children's rights. At the global level, the ILO has set minimum age requirements for work and states that 15 years is the minimum age for work (13 for light work), while hazardous work is only permitted for individuals aged 18 or 16 under certain strict conditions.

Child labor also has long-term impacts that could make the operating environment for business more challenging in the future. In underregulated areas, procurement teams may find it difficult to determine whether possible new suppliers or business partners have child labor in their operations or their own supply chains, which could trigger new and emerging human rights and modern slavery reporting requirements. Additionally, by exacerbating existing social inequalities, child labor can reduce the earning potential of already disadvantaged groups, which can prompt the decline of a diverse and skilled workforce.

Online activities, not yet covered by child labor laws, further complicate the regulatory landscape for business. A new law in Illinois introduces the first protections in the US for Child Influencers, or children with large social media followings, entitling under-16s to a proportion of earnings from social media posts.

What can businesses do? 

• Adopt and implement clear corporate policies that prohibit the use of child labor and set out expectations for ethical business for suppliers and business partners.

• Conduct human rights due diligence to determine how certain factors may increase risks of child labor in their own operations or supply chains, including increased migration, economic downturns, and conflict. Companies in high-risk sectors can also conduct enhanced human rights due diligence and specific child rights risk assessments. 

• Engage suppliers by awareness-raising, training, and capacity building to prevent, identify and address child labor, including understanding the root causes. Companies should also train and monitor supplier subcontractors and recruitment agencies. 

• Provide decent work opportunities, including traineeships and apprenticeships, to young workers and adolescents while equipping them with relevant skills needed to prepare for the future workforce. 

• Collaborate with peers, industry, business across different sectors, and suppliers to jointly address systemic risks of child labor and other forms of modern slavery. The Global Business Coalition Against Human Trafficking (GBCAT), for example, aims to scale business action to prevent modern slavery, including child labor, through supplier capacity building, survivor empowerment and employment, leveraging technology solutions to fight human trafficking, and addressing the misuse of technology to facilitate crime.​ 

• Where possible, work with relevant stakeholders to advocate for strengthening legislation to protect against child labor violations.

• While companies should, at a minimum, comply with national laws and regulations, they should always adhere to the highest standard (as enshrined in international laws, standards, and regulations). 

• Publish and report risk assessment findings (including in operations and supply chains) to help increase industry transparency around risks and root causes and demonstrate actions that are being taken to prevent, identify and address child labor. 

• Collaborate with relevant stakeholders to provide appropriate remediation where child labor is identified on a case-by-case basis. This also includes requiring suppliers to have a robust remediation plan. 

Debate and leadership are required to ensure child protections are fit for a changing world, and not to jeopardize tomorrow’s workforce for short-term gain. Contact us to understand how your company can lead within an increasingly complex and fragmented global human rights landscape. 

People

Rachel Fleishman

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Rachel leads BSR’s Consumer Sectors team in the US, focusing on topics related to business transformation. She helps companies across a range of consumer-facing industries leverage sustainability insights and tools to drive innovation, create impact and build resilience in the face of market turbulence and disruptive global trends.

For the past 20 years, Rachel has worked at the intersection of sustainability and innovation, business development, advocacy, and cross-sectoral partnerships in the US, Europe and Asia. She has held leadership positions at the American Chamber of Commerce to the EU, the Clinton Global Initiative, the Hong Kong-based Climate Change Business Forum, and BASF. Rachel has advised the US and allied governments on the impacts of climate change on national security and has created sustainability crisis simulations for government, business and academic use.

Rachel has a BA from Tufts, a Masters in Public Policy from the School of Public Policy, University of Maryland and an MBA from Kellogg, Northwestern University.

People

Olivia Hughes

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Olivia works closely with several of our AoE teams, including Climate, Nature, and Equity, Inclusion and Justice. She provides administrative and research support, while also securing cross-functional team collaboration opportunities.

Prior to joining BSR, Olivia held government positions with the United States Secret Service, the Office of Senator Kirsten Gillibrand, and the New York State Assembly.

Olivia has a BA in Political Science with minors in Public Policy and History from Hobart and William Smith Colleges.

Blog | Thursday September 28, 2023

BSR’s Climate Journey Toward Net Zero

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With 2030 quickly approaching, global climate commitments must move toward swift action to halve emissions and reach global 2050 net-zero goals. At BSR, we work with our membership network to deliver credible action to keep 1.5°C within reach, while also maximizing synergies with nature; human rights; and equity, inclusion, and justice.

While we focus on sustainability impact in all the work we do with our members, like all organizations, our day-to-day operations have an environmental impact. It is important we hold ourselves to the same standard we expect from members, and recognize this opportunity to share openly about our climate journey. We have therefore set a climate target for our organization and embarked on a journey to deliver on it. 

Our Climate Target

Using BSR’s 2021 GHG footprint as the baseline, BSR commits to: 

• A near-term (2030) target, to reduce total Scope 1 (own operations) Scope 2 (energy source) emissions by 50%, and our top emitting total Scope 3 (value chain) emissions by 42%. 

• A long-term (2040) target, to reduce total Scope 1&2 emissions by 90%, our total Scope 3 emissions by 90%, and to reach net-zero by neutralizing residual emissions with permanent removals. 

Starting in 2023, we are applying a carbon price to our Scope 1, 2, and 3 emissions, and using the funds to invest in climate solutions that contribute to global net zero beyond our value chain. In 2023, we have decided to use the US Government Social Cost of Carbon as a reference. 

For more information on BSR’s GHG emissions data and climate targets, please visit Sustainability at BSR. 

Climate Goal Development Process 

We believe impactful work and a credible climate target and implementation plan go together. The SBTi Net Zero Standard is the most robust standard currently available, and although as a non-profit we cannot officially commit to the SBTi, we are committing to a target that follows SBTi’s guidance.

BSR’s climate goal and implementation plan are grounded in four key principles: 

1. A clear vision on transformative climate leadership. 

2. Learning from peers’ climate ambitions to ensure alignment with best practices. 

3. Aligning with the recommendations provided to BSR members and demonstrating a commitment to “walking the talk”. 

4. Leveraging the transformative power of BSR’s unique membership network model as a catalyst for broader change. 

BSR’s climate goal development process began with a comprehensive greenhouse gas footprint from an external expert. We then participated in one-to-one discussions on the learnings and challenges of developing a climate strategy with non-profit peers, and benchmarked industry counterparts and partners before forming and testing the feasibility of multiple climate goal options in alignment with the SBTi Net Zero Standard. The creation of the implementation plan included a review of our emissions data to understand BSR’s leverage to influence and reduce Scope 3 emissions, our largest source of emissions—largely due to our contractors and professional services use.

The whole process was validated by BSR’s internal experts, leadership team, and the CEO to ensure 1) internal operational and financial support and 2) alignment with business needs to continue our mission. 

Implementation and Beyond 

Climate commitments have true value when accompanied by a robust implementation plan with specific milestones. The delivery of our climate targets starts in 2023 and is supported by three timebound task forces: 

• Renewable energy, heating, and green offices: Propose strategies to reduce offices’ GHG footprint and engage staff in sustainable practices at the office—including green IT and waste reduction—both with considerations for the impact of home working. 

• Policy development: Include climate considerations in travel and contractor engagement policies to reduce emissions from two of our largest sources of Scope 3 emissions—business travel and purchased services. 

• Beyond value chain mitigation strategy: Develop and deliver BSR’s strategy to invest in climate solutions from now and define parameters for our long-term strategy to invest in carbon removals. 

A key aspect of our implementation plan is the use of the social cost of carbon to fund our investments in climate solutions that contribute to global net zero beyond our value chain. We hope that this unique approach can inspire others to ground climate investment estimations in amounts that reflect the real-world damage to people and the environment.

Although BSR is a small organization with a small GHG footprint on a global scale, we believe that our current climate goal will bring positive impact and help us take responsibility for our impact. In parallel, we are working on ways to activate the great potential for GHG emissions reduction with our members. 

BSR’s implementation plan consists of collaboration across departments, engagement with partners and BSR members, and continuous iteration. We have climate goal implementation taskforces involving different functional teams on climate action and will work with partners and BSR members to reduce GHG emissions together. While we are still figuring out how to address our main Scope 3 hotspots, such as our contracted services and partners and business travel, we are not waiting until we have a perfectly developed strategy to act. 

Leading by Example 

BSR acknowledges the ambitious nature of our net zero target. As a small organization, we have limited leverage on our Scope 3, and do not have all the solutions now nor the resources of the large companies with which we work. However, we remain steadfast in our commitment to playing our part in achieving global net-zero and being an example of how SMEs can prioritize sustainability.

This pledge reflects BSR's core identity as a sustainability organization, the urgency of the climate crisis, and our attitude to “walking the talk” with transparency, humbleness, ambition, and a commitment to sustainable business practices.

Achieving climate goals is a journey, and BSR remains dedicated to regularly reviewing our climate strategy, open communication on our progress, and continuous improvement, including expanding our sustainability efforts to address other important issues in the future. 

Blog | Wednesday September 27, 2023

Making Connections Across Professions

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One of BSR’s three core principles for putting our mission into action is to “make connections between issues.” Recent developments in the field of just and sustainable business are re-enforcing the importance of this principle. 

BSR has long emphasized that addressing impacts on the environment, people, enterprise value, and the economy requires holistic approaches.  

However, this point of view has not always been matched by the various initiatives, guidelines, and standards that shape day-to-day work of the just and sustainable business field. These have often been the realm of specialist and distinct professional communities, such as those in human rights, social justice, climate change, and sustainability reporting. 

Encouragingly, there has been an acceleration of alignment among initiatives, guidelines, and standards over recent years. We’re optimistic about these developments and believe they will be sustained by a deliberate joining up of these previously separate domains. 

Examples of greater connection between the fields of reporting and disclosure, business and human rights, diversity, equity and inclusion (DEI), social impact, and climate change are increasingly common.  

The “impact materiality” principle in the new European Sustainability Reporting Standards (ESRS) clearly states that “the materiality assessment of a negative impact is informed by the due diligence process defined in the international instruments of the UN Guiding Principles on Business and Human Rights and the OECD Guidelines for Multinational Enterprises.”  

The ESRS and the new IFRS Sustainability Disclosure Standard General Requirements both adopt and build on the four-part “governance – strategy – risk – metrics” framework first introduced by the Taskforce on Climate Related Financial Disclosures (TCDF). 

The climate disclosure standards recently published by the IFRS and ESRS are significantly ahead of their social counterparts and serve as a holistic model for other issue-specific standards to build from. 

However, achieving this progress in practice requires that we address some challenging methodological questions and spread best practices across professions. For example: 

• How do we take the concepts of scope (number of people), scale (gravity of harm), and remediability (ability to reverse harm) that are well-understood in the field of human rights and apply them to environmental impacts such as climate change, as is required by the ESRS and GRI? 

• Given they both now use the same prioritization criteria, should previously separate materiality and salience assessments be combined? If so, how, and what are the risks and opportunities of doing so? 

• How do we ensure that we are addressing inequities in outcomes and opportunities, and promoting diversity, equity and inclusivity in systems and infrastructure designed to address environmental impacts? 

• How can best practices in DEI and human rights due diligence inform new methods of environmental due diligence and support integrated due diligence efforts? 

• How do expectations for accuracy, reliability, and comparability of quantitative data transfer to the often more qualitative realm of social impacts?  

• Are quantitative forward-looking targets always the gold standard, or are other approaches (such as qualitative or normative statements of ambition) sometimes more appropriate? 

• How might scenario analysis, common in the climate change field, improve the quality of DEI and human rights due diligence and understanding of social impact across the value chain? 

• How do we undertake DEI and human rights due diligence of the energy transition? 

• How can we work with boards, executive management, and sustainability experts to facilitate greater collective understanding, action and governance of material risks, opportunities, and their impact on long term business value? 

• How do we effectively engage affected stakeholders in all our efforts without causing significant fatigue? 

We know that the answers to these questions and many more will only be resolved by multi-disciplinary teams taking collaborative approaches and addressing shared challenges together.  

Many of our company members are joining up functions and collaborating among finance, risk, compliance, supply chain, strategy, DEI, and sustainability teams to apply the various new requirements of impact materiality in a combined corporate approach.  

And we at BSR are equally joining experts from our teams on projects together and sharing insights across different functions and teams to better partner with our member companies.  

We look forward to opportunities to collaborate with other organizations—outside counsel, large consulting companies, and audit firms—in multi-vendor arrangements where we can achieve more together than we could alone. 

Making connections between issues is easy to say, but hard to do in practice. However, this moment demands nothing less in our mission to work with business to create a just and sustainable world. 

Blog | Tuesday September 26, 2023

Why an Impactful Sustainability Strategy needs Collaboration

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When discussing BSR’s Collaborative Initiatives with members, we are often asked “What is the value proposition? Is it worthwhile?”

The immediate value proposition, or the “service” that collaboration can offer in the near term is an insufficient measure of the deeper strategic value that comes from engaging in collaboration for sustainable development. Collaboration is the only means by which companies can meet their long-term business and sustainability goals, where these goals cannot be achievable independently.

Nonetheless, we frequently see participation with short-term aims, and left off longer term corporate strategic roadmaps.

At BSR, we believe that the lasting value of contributing to collaborative efforts is like that of a Research & Design function: when done well, the catalytic mix of co-investment, collective creativity, problem-solving, and cross-sector relationship development can lead to entire systems change that enables markets to continue to thrive, more sustainably.

For example, members of Action for Sustainable Derivatives initially came together to improve transparency of palm oil derivatives down to farm and field level, and due to the strength of the collaboration have expanded its ambition to create deeper impacts, e.g. launching a social impact fund in partnership with strong local non-profits, with momentum toward further innovation in the future. Examples of the application of collective muscle for systemic leverage are evident across multiple collaborations such as RISE (Reimagining Industry to Support Equality), a recent merger of collaborative initiatives working for female equality in the textile industry. 

Companies are petitioned every day to join new partnerships and collaborations, and it can become overwhelming. How might a sustainability team make strategic decisions about which collaborations to join, and justify the time and expense? And how can the company tap into the deeper, strategic value that collaboration can add to their sustainability journey? 

We encourage every company to consider collaborative opportunities across the entire sustainability strategy journey. The following chart includes key considerations for a sustainability team across each step to inform, align with, and contribute to their broader strategy through collaboration. 

Key recommendations and considerations for high-impact collective action when setting sustainability goals include:

Set Direction 

Are we part of the right collaboration? Are there ways to leverage collaborations to achieve greater influence on issues and risks where the company has limited influence? 

• Consider tapping the expertise of your collaboration to continuously scan for emerging sustainability risks and opportunities to better understand the current environment. 

• Don’t overlook the value of industry or issue area working groups that explore emerging issues—these can be valuable, and ongoing sources of information for corporate strategic planning.

• Encourage the company’s representatives to meet on a regular basis to share learnings and updates, inform internal teams on agreements made, and brainstorm new approaches. 

Develop Strategy 

When setting sustainability goals, are we thinking individually or systemically? How might we better align our individual corporate goals and targets with that of the collaborative initiative? Do we have a rubric to evaluate and prioritize the collaborations that we participate in? 

• It is tempting to establish sustainability goals that are achievable by the company alone, with little external engagement required. But where business transformation is required, systemic engagement is needed as well.

• Consider offering collaborations that directly align with the company’s sustainability strategy more time, resources, and expertise, to establish ambitious goals, and to accelerate shared objectives. 

• Study a collaboration’s theory of change, which points to its long-term objectives and the means through which the collaboration expects to achieve them. Consider how the company’s sustainability strategy might complement or even directly contribute to the collaboration to progress the collective effort. (If a collaboration is not able to articulate its theory of change, this may be an indication that it is not a strong partnership). 

Implement Strategy 

Are we assigning the right leaders to participate in collaborations, and equipping them to make decisions on behalf of the company? Are we resourcing critical collaborations sufficiently to meet our shared goals? How might we establish accountability for collaborative results? 

• Assign a senior-level decision maker to lead engagement with priority collaborations. Ensure that the company has multiple contacts with critical collaborations, sharing learning and supporting the company to maintain relationships through periods of team transition. 

• Acknowledge the value of relationship building within the collaboration process, and the value the relationships can bring to the company in the long term. Make time and resources available for in-person convening and in-depth relationship development and work. 

• Proactively funnel resources, expertise, and autonomy in decision-making to the company’s collaboration leaders, to enable them to move fast, react in real time, and drive forward your shared goals. 

Engage and Refine 

Which collaborative efforts are working? Are there any sustainability issues that we are not yet collaborating on, and if so, why not? Are we actively engaging in our collaborations to provide feedback on their strategy? 

• A company may engage in many different kinds of collaborations and partnerships, knowing that a few will lead to outsized impacts, while others will not be as successful. A strategic approach to collaboration includes active portfolio management to responsibly prune those that no longer meet the company’s needs, and to add fuel to those that show promise. 

• Participate in providing meaningful and timely feedback to the collaboration’s secretariat, ensuring they are well-informed about the company’s needs and ideas for impactful activities. 

Collaboration is an impactful tool that many companies are only in the early stages of understanding how to use strategically, not only to achieve their own goals but also to transform a wider system. Having a well-defined collaboration strategy and investing in the skills of employees to participate in collaborative initiatives in ways that maximize a company’s investment, are key factors for success. 

Please contact the Collaborations team at BSR with any queries about how we can assist you in integrating collaboration into your corporate sustainability strategy.

People

Laura Dugardin

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Laura supports BSR’s work on equity, inclusion and justice topics.

Prior to joining BSR full-time, Laura interned and was a contractor for BSR and RISE, on the topics of Human Rights and Women’s Leadership & Advancement. Laura also worked as a consultant for the Danish Institute for Human Rights on Baseline Assessments practices leading to National Action Plans on Business & Human Rights. She conducted research with the University of Geneva on the integration of children’s rights in Swiss-based companies. Laura also has experience with policy work, including on Gender and Corruption for the G20. She extensively engaged on youth participation in democracy, including at the Council of Europe, in grassroot organizations or through self-led projects.

Laura holds a MA in International Development from Sciences Po Paris, and a first-class honors BA in Business and Latin American Studies from EDHEC Business School. Laura is fluent in English, French and Spanish.

People

Marion Fischer

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Marion is responsible for managing and developing BSR’s Collaborative Initiatives (CI) portfolio—providing dedicated support to the management of the portfolio as well as administrative, operational and event planning, and logistics support to key BSR CI staff and CIs across the portfolio.

Prior to joining BSR, Marion worked for the International Institute for Strategic Studies, a think tank in international affairs and global security, managing events and providing programmatic and administrative support to their Washington DC office. Previously, Marion worked for Greenflex in Paris, a consulting company in sustainable development, where she worked to foster and manage relationships with clients and their stakeholders and analyze human rights violations on clients' supply chains.

Marion holds a Master’s degree in French and common law from the University of Nanterre. She also graduated with an LLM from Boston University and is a member of the New York Bar. Additionally, Marion holds a Master's degree in International Project Management from ESCP Europe.

Insights+ | Monday September 18, 2023

The Evolving Reporting Landscape

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